The Option Market Shows the Way Through This Low-Volume, Fed-Driven Melt-Up
The S&P 500 ended today’s session a little more than 1% higher than where it started. Not bad… but before you get too giddy, consider that gold equaled the market’s one-session gain and silver, the “junior metal,” blew them both clean out of the water. At the same time, trading volume in equities has…
Traders Are Delusional If They Think This Bad Jobs Report Is Any Good
No matter how you slice it, we’ve had an extraordinarily volatile week; stocks were reeling like so many drunks from data to the Fed to earnings to data. Apple, a juggernaut of the S&P 500, took off on an earnings miss yesterday because, “Hey - no worries, $110 billion in buybacks are coming.” (If all…
The Fed Is Telling Us: Move Into Non-Cyclical Stocks
The Federal Reserve and its chairman, its various and sundry governors, presidents, and number-crunchers are (in)famous for… not really saying much when it actually counts. Yesterday, for instance, Chairman Powell said… nothing new or unexpected or particularly useful: Rates aren’t getting cut anytime soon, they’re going to stay the same. We knew that. But…
Fed Day Is Over…But the Fallout Isn’t
The markets rallied strongly after the Fed non-announcement today (an 80-handle move at one point)... only to fall right out of bed in the last 30 minutes or so of trading. We saw a really dramatic, volatile reversal. Volatility futures actually fell as Powell was talking but then picked back up again later in the…
“Buy the Dip” Could Become “Sell the Rip”
I’m a little concerned with the bullish trend we’ve seen shaping up lately. Lower highs are starting to creep into the equities picture. The trouble in Japan with the yen and the lack of change in policy there could be starting to spill over across financial markets; global capital is seeking refuge in the dollar.…
Tesla’s Autopilot Breakout Is Only the First Event of a Busy News Week
Tech had a pretty good day. Tesla shares finished the day more than 15% above where they started on news the company will roll out its advanced driver assistance tech in China. Mega-cap stablemate Apple also helped lift the S&P 500 as Citi confirmed the stock would keep a “Buy” rating ahead of May 2…
I Don't Trust This Rally a Bit - You Shouldn't Either
SPY ripped around 53 bucks to the upside before the close… but I don’t feel great about it. I’d never hate on a good rally, but this ain’t that. That might change next week, but we’ll deal with that when we come to it. My unease with this upswing has got nothing to do…
Bonds, Banks and Builders Make Strange Bed Fellows
Over the past few weeks we’ve talked about the upside in shorting bonds - and taken some positions accordingly over in the Live Trading Room. We’ve talked about weakness in homebuilders’ stocks, too, and we’ve also acted on that thesis. There are some interesting developments that suggest we could be in for lower lows there…
That Volatility Beast I Mentioned? It's Not Done with You
Last week I warned everyone that volatility was going to go on a rampage. And that’s exactly what it did. And here’s the thing: It’s not over, not by a long shot. The rally sputtered and nearly died today. By the close it had made up some ground to end up… “massively unchanged.” But in…
Last Week I Said 'Buy the Dip' - I Sure Hope You Did
We were excited for last week’s lows, and for a good reason. I told everyone to wrestle with the bear and get in the market and go shopping. We’re off those levels now, and I still think taking advantage of the selloff was the right call. I’m seeing some encouraging signs bubbling underneath the rally…